Former Treasury secretary Henry M. Paulson Jr., Federal Reserve Chairman Ben S. Bernanke and other top government officials have said they did not notice the dangers that Michael Blomquist saw in the runaway California housing market until five years after he did.

As home prices and loan amounts in California's Silicon Valley, one of the nation's hottest markets, began mushrooming in late 2003, lying, scheming and recklessness were becoming everyday occurrences, Blomquist said.

Blomquist, a San Jose real estate and mortgage broker, was sure that tricky loans - and the inflated incomes on loan applications - would lead to a housing bubble with disastrous consequences.

Refusing to commit "felony mortgage fraud," he said, he closed his offices in January 2004, long before the housing meltdown, and began a sort of one-man crusade to expose what he calls "a criminal conspiracy to turn the housing market into a giant Ponzi scheme."

Over the next four years, Blomquist futilely tried to dissuade clients and friends from putting their life savings into pricey homes. He wrote letters warning federal regulators and members of Congress that mortgage fraud was creating "a perfect storm" in the housing industry.

Acting as his own attorney, he even waged a federal court fight against some of the biggest subprime players, as well as Paulson and other top federal regulators, accusing them of conspiring to fraudulently inflate home prices and asking the court to bar the issuance of one widely used type of risky mortgage.

Responding to Blomquist's letter on Sept. 1, 2005, Sen. Dianne Feinstein (D-Calif.) assured him that she was "monitoring the situation closely." Suzanne Killian, an assistant director of the Fed's consumer unit, advised him later that month that his concerns would be considered.

In the end, however, his warnings brought no serious action until the bubble began to burst.

Did Blomquist, with his inside view of the market, have a better understanding than did Bernanke and his predecessor at the Fed, Alan Greenspan, who failed to rein in subprime mortgage lenders? Could Blomquist, with a two-year college degree, have a better grasp of the danger than did Paulson, who oversaw Wall Street giant Goldman Sachs's investment in subprime mortgage securities and was the Treasury secretary when the market crested?

That's hard to know.

What's clear is that Blomquist set himself apart from tens of thousands of real estate agents nationwide who rode the mania and kept selling properties for spiraling prices until they crashed.

"When fraud becomes the competition, anybody who has any ethics is driven out of business," he said. "As a fiduciary, I felt I couldn't do my job. Your role is to be aware of market conditions. . . . You're supposed to put clients' interests ahead of your own.

"I'm by no means a saint, but I'm not going to be the cause of somebody losing their life savings or becoming enslaved in a debt for a grossly overpriced house just to make a living."

In California's Santa Clara County, Blomquist said, the median price of a modest home more than doubled, to $900,000. The most prevalent loans in the county, he said, were option adjustable-rate mortgages, in which borrowers could pick their initial monthly payments for five years. Most of them chose the lowest payments, but that increased their loan balances and all but assured huge monthly payment hikes when their interest rates jumped.

Most of Blomquist's clients and friends shrugged off his warnings, stretched their finances and traded up to more expensive houses, he said. When the market crashed in 2008, the county's average median home price plunged from $869,000 to $450,000 "in about six months," he said.

Blomquist battled a throng of lawyers for more than a year before a judge dismissed his claims, ruling that he lacked standing and jurisdiction. Blomquist says he may appeal.

Washington Mutual later collapsed in the biggest bank failure in U.S. history. Countrywide and Bear Stearns were rescued in mergers, while Goldman and Citigroup got federal bailout loans. Prince retired after Citigroup reported massive mortgage losses in late 2007.

Now 43, Blomquist got back into the housing business this year, since the pendulum has swung and borrowers again must produce tax returns and other records to prove their incomes.